Venture Firm YZi Labs Weighs External Funding Options

Binance Founder Changpeng Zhao’s $10 billion venture firm YZi Labs is considering opening its fund to external investors. This critical decision signals a major investment strategy shift amid increasing investor interest.

CZ Venture Firm YZi Labs Expands Horizons

According to a recent Financial Times report , the CZ venture firm YZi Labs is pushing beyond limits, opening its $10 billion fund to external investors. The platform head Ella Zhang, stated, “There’s always a lot of external investors interested and we will eventually consider turning it into an external-facing fund. We just think it’s not there yet.” Addressing the potential move as a “huge responsibility,” she added,

“In AI and biotech we’re still early, we’re forming our team. When we have that expertise, we have the confidence level, we’ll open up for external investors.”

YZi Labs, a major crypto investor spun out of Binance in January, manages billions for founder Changpeng Zhao and a select group of executives. After taking in $300 million in outside investments in 2022, the firm is now considering converting into a fully-fledged investment fund open to outside shareholders.

Notably, Zhang noted that investing $10 billion in crypto presents significant deployment challenges. Reflecting on CZ ’s words, she posited that her “your challenge is to deploy.” “It’s just so hard to find so many good enough assets to meet our criteria,” she added.

Investor Interest Surges

Reportedly, the venture firm YZi Labs partially returned external funds after realizing its existing assets under management were already substantial. Though Zhang declined to reveal investors’ names, she claimed that the surge in investor interest has led to the new plans. She added,

The demand is very high, a lot of external [investors] want to invest alongside us. For the majority of the projects we invest in we’re not in a rush…to exit …it’s hard to deliver what they expect.

Zhang Praises US Crypto Regulation

Interestingly, the Head acknowledged the US President Donald Trump and the SEC’s progressive approach to cryptocurrency. She claimed that the renewed stance has become more favorable for the growth of the digital asset industry in the country.

The SEC's interest in private demo showcases of crypto companies backed by YZi Labs is a testament to this shift. Zhang notes that this change in attitude has encouraged crypto entrepreneurs who fled the US during the previous administration to return to Silicon Valley. She praises SEC commissioners like Paul Atkins for their open-minded approach, which is helping to promote the US as a crypto hub.